Bank of America Internal CEO Candidates ‘Tainted,’ Finger Says

By Dakin Campbell

Oct. 8 (Bloomberg) -- Bank of America Corp., the biggest U.S. bank by assets, shouldn’t promote executives Brian Moynihan or Gregory Curl to chief executive because they’re “tainted” by the Merrill Lynch & Co. takeover, a shareholder said.

Finger Interests Number One Ltd., owner of more than 1 million Bank of America shares, said internal candidates to succeed Kenneth D. Lewis as chief executive officer are too close to investigations of the Merrill purchase, according to a federal filing yesterday. Shareholders should look outside the company for a new CEO, the investor said.

“This is the same management team that brought us the Merrill Lynch deal,” Jonathan Finger, managing partner at Houston-based Finger Interests, said in an interview yesterday. “They have destroyed shareholder value.”

Jonathan and his father Jerry Finger helped lead a shareholder revolt that stripped Lewis of the chairman’s title at the April annual meeting. Lewis, 62, has been criticized by regulators, lawmakers and shareholders for failing to tell investors about bonus payments and growing losses at Merrill Lynch before shareholders voted last year to approve the bank’s takeover of the New York-based brokerage.

Moynihan, 49, head of the retail-banking unit, and Curl, the chief risk officer, are the leading internal candidates to replace Lewis, according to a person familiar with the succession process, which is private. The bank’s deliberations were reported earlier by the Wall Street Journal.

‘Not Credible’

“The current management team is tainted and not credible,” Finger Interests said in the filing. “Shareholders deserve a change.”

Robert Stickler, a spokesman for Charlotte, North Carolina- based Bank of America, declined to comment.

Finger Interests, controlled by a Houston family, may have the ear of other investors, said Joe Morford, an analyst at RBC Capital Markets in San Francisco, who has a “sector perform” rating on the stock.

“They were one of the more vocal ones pushing the chairman issue earlier this year,” Morford said. “I suspect this will be pretty well disseminated.”

New York State Attorney General Andrew Cuomo has said he’s considering charges against bank executives over the Merrill transaction.

“As senior members of management, surely these individuals were involved -- hands on -- in details related to the Merrill Lynch transaction,” Finger Interests said in the filing. “How can the board of directors be certain that neither individual will be charged or implicated in wrongdoing?”

To contact the reporter on this story: Dakin Campbell in San Francisco at dcampbell27@bloomberg.net